DOT1L, the only H3K79 methyltransferase in human cells and a homolog of the yeast Dot1, normally forms a complex with AF10, AF17, and ENL or AF9, is dysregulated in most cases of mixed-lineage leukemia (MLLr), and has been believed to regulate transcriptional elongation on the basis of its colocalization with RNA polymerase II (Pol II), the sharing of subunits (AF9 and ENL) between the DOT1L and super elongation complexes, and the distribution of H3K79 methylation on both promoters and transcribed regions of active genes. Here we show that DOT1L depletion in erythroleukemic cells reduces its global occupancy without affecting the traveling ratio or the elongation rate (assessed by 4sUDRB-seq) of Pol II, suggesting that DOT1L does not play a major role in elongation in these cells. In contrast, analyses of transcription initiation factor binding reveal that DOT1L and ENL depletions each result in reduced TATA binding protein (TBP) occupancies on thousands of genes. More importantly, DOT1L and ENL depletions concomitantly reduce TBP and Pol II occupancies on a significant fraction of direct (DOT1L-bound) target genes, indicating a role for the DOT1L complex in transcription initiation. Mechanistically, proteomic and biochemical studies suggest that the DOT1L complex may regulate transcriptional initiation by facilitating the recruitment or stabilization of transcription factor IID, likely in a monoubiquitinated H2B (H2Bub1)-enhanced manner. Additional studies show that DOT1L enhances H2Bub1 levels by limiting recruitment of the Spt-Ada-Gcn5-acetyltransferase (SAGA) complex. These results advance our understanding of roles of the DOT1L complex in transcriptional regulation and have important implications for MLLr leukemias.